New Zealand Economy

From Statistics New Zealand: Key labour market measures showed an increasingly tight labour market, with unemployment and underutilisation near record lows, employment at an all-time high, and wage growth strong, Stats NZ said today.

The Reserve Bank of New Zealand (RBNZ) today lifted the cash rate from 0.25% to 0.5%, representing the first hike in seven years. Below is the statement: The Monetary Policy Committee agreed to increase the Official Cash Rate (OCR) to 0.50 per cent.

Auckland has been in a lockdown since 18 August. Last week, New Zealand Prime Minister Jacinda Ardern stated that the government was still aiming to eliminate the virus. However, after ongoing double-digit new cases (see above chart), Ardern officially abandoned her elimination strategy, easing restrictions in locked-down Auckland.

Back in May, New Zealand’s Ardern Government vowed to end low-skilled, wage crushing migration via a “once-in-a generation” reset for New Zealand’s immigration system.

Auckland has been in a lockdown since 18 August with the Ardern Government still aiming to eliminate the virus.

On 23 March, the New Zealand Ardern Government announced major property tax reforms targeted at investors, specifically: extending the term of the Bright Line Test for taxing capital gains on investment property from five years to 10 years; and fully removing the tax deductibility of mortgage interest payments on residential investment properties.

The Reserve Bank of New Zealand (RBNZ) today announced that it will tighten lending rules for mortgages from 1 November, but expects banks to comply with the “spirit” of the new rules immediately.

Auckland has been in a strict lockdown since 18 August but has been unable to eliminate the Delta virus: Yesterday, 22 cases were recorded – the third day in a row of over 20 cases.

New Zealand’s average house price has hit $1 million for the first time: New figures from OneRoof and its data partner Valocity show the typical cost of a property around the country increased 4.9% in the last three months and 27% since September 2020.

New Zealand has recorded another 70 locally acquired COVID cases taking total active community cases to 347: All of today’s cases were in Auckland.

New Zealand has recorded another 68 locally acquired COVID cases taking total active community cases to 277: The total number of community cases in Auckland is now 263 and in Wellington it is 14.

The New Zealand Ministry of Health today reported another 62 new cases of COVID-19 in the community bringing the total number of locally acquired cases to 210: The total number of community cases in Auckland is now 198 and 12 in Wellington.

The New Zealand Ministry of Health today reported another 41 new cases of COVID-19 in the community bringing the total number of locally acquired cases to 148: The total number of community cases in Auckland is now 137 and 11 in Wellington.

Another day, another story about how the collapse in immigration is driving up wages and conditions for domestic workers that no longer have to compete for jobs with foreigners.

From ANZ’s New Zealand economics team: Housing market overview A few months have now passed since the Government announced its suite of housing policy changes, and as the dust settles, a rather robust market is being revealed.

That seems to be the indication from Roy Morgan’s latest polling of New Zealand voters: Support for New Zealand’s Labour/Greens government dropped 5% points to 51% in June – the lowest for the Government since the COVID-19 pandemic began.

Interest.co.nz’s David Hargreaves has posted the below chart showing that Kiwis continue to leverage big time into non-productive housing lending, whereas consumer lending has also rebounded hard.